Despite the Q4 net loss of RM1.1b, it stayed profitable for full year
KUALA LUMPUR: Malayan Banking Bhd (Maybank) posted a net loss of RM1.12bil in its fourth quarter, hit by an impairment bill of RM1.73bil from the acquisition of banking assets in Indonesia and Pakistan, but sees a much better performance in its current financial year.
The country’s biggest bank remained profitable for the full year ended June 30 (FY09), but its dividend payout tumbled to eight sen per share compared with a total of 52.5 sen per share it paid in FY08.
“We look forward to a much improved financial performance for financial year 2010 (FY10),” Maybank president and chief executive Datuk Seri Wahid Omar told a press briefing in Kuala Lumpur yesterday.
He revealed the group’s key performance indicators (KPIs) of 8% in revenue growth and return on equity (ROE) growth of 11% on an enlarged capital base post a RM6bil rights issue.
“We don’t expect any more impairment charges next year,’’ Wahid said.
Impairment charge is the difference between the price paid for an asset and its actual value. Maybank decided to take a one-time hit of RM1.619bil in the last quarter for the high price of RM7.9bil it paid for a stake in Bank Internasional Indonesia (BII).
Wahid said BII would contribute a small profit to Maybank in FY10. He predicted growth from its Indonesian operations “to outstrip” all other markets in the future.
For FY09, Maybank made a net profit of RM691.8bil, or 12 sen per share. This was 76% lower compared with a net profit of RM2.93bil, or 53.3 sen per share, achieved in FY08.
Wahid said the bank’s profit was also affected by higher loan-loss provisions and increased interest cost to RM445mil after the bank issued RM9.1bil in capital securities and subordinated debts.
Loan-loss provisions amounted to RM1.7bil, or 109.7% higher than in the preceding year, due to the global economic crisis. Loan-loss coverage stood at 112.9% at June 30, compared with 101% a year earlier.
Maybank’s local banking operations contributed 72.5% to the group’s pre-tax profit of RM1.67bil for the year.
Gross loans grew 13% year-on-year due to the consolidation of BII. Excluding the BII contribution, loans growth would be at 5.8%, a sharp decline from the 16% recorded last year after domestic growth halved from 12.1% to 6.4%.
In his presentation slide, Maybank chief financial officer Khairussaleh Ramli showed a financial table which highlighted that had there been no acquisitions last year, the group’s pre-tax profit from existing operations would amount to RM3.76bil.
This is still 15.2% lower than the RM4.44bil pre-tax profit posted in FY08
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What happen to the giant bank in Malaysia? Do they really have the problem with the purchased of the BII? Are this statement positive correlated with bank negara instruction to reestablished the directors? There are many assumption could be made to the bank. As we look into the share as at 28/8/09 was RM 6.51. The share price is playing around the range of RM 6. As far as early year 2000 the maybank share is very well recovered and I remembered it went up until RM 16. Do those positive past track records could be revived. Nevertheless the bank still insist to declare their profit . It is probably just to maintain the perception of public on their strength and capability to compete in the industry
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